The decision by Toly products to relocate business from the UK to Malta is testament to the skill of the Maltese worker, the success of the company and the success story which is Malta, said Prime Minister Lawrence Gonzi yesterday.

Dr Gonzi, accompanied by IT and Investment Minister Austin Gatt, was on a visit to the Toly Products plant in Zejtun yesterday. CEO Andy Gatesy said that Toly had relocated two parts of its business to Malta – a brand new manufacturing unit which has been dedicated for Chanel products and the development unit. Chanel is Toly’s largest customer and in 2006, it had sales to Chanel of over EUR5.5 million from the Malta plant. “We have been working with Chanel for 18 years and we are one of their main suppliers globally in the field of colour cosmetic packaging,” he said.

Mr Gatesy explained that for many years, Toly built its own tools in the UK. “Unfortunately, the skills of tool-making have become cost prohibitive in the UK and at the end of last year, Toly closed down its in-house toolmaking facilities.”

He said: “The company’s development team ran alongside the toolroom, so with the closure of the latter, we had the opportunity to reassess this situation and it was decided that we would relocate our development unit to Malta alongside our manufacturing plant. Earlier this year, all equipment was shipped over from the UK to Malta and we have now been running for a few months.”

He said that with the flexibility and skills of the Maltese workforce, Toly improved its development performance and has become more focused in starting new projects on time and meeting customer requirements. The company has been in Malta since 1969 and employs some 400 workers – many of whom have been there for over 20 years.

Dr Gonzi said the fact that Toly Products remained in Malta and even relocated business here was testament to the fact that Malta had a bright future ahead of it. “We were in transition and it wasn’t easy, yet we are booming. Everything in the international situation is challenging – the rising price of oil, the falling dollar, the emergence of China – yet we, Malta, are a success,” he said.

He said there was a future in Malta and that it was all in line with the government’s vision for 2015.

Dr Gatt said Toly has production plants in low cost countries as well but for Toly, Malta represents the brains of what is now a global operation.

“It may be coincidence but in the last few weeks Malta Enterprise has approved two new engineering projects which both have operations in low cost countries but both have chosen Malta as their destination for higher value added production,” he said.

He continued: “Manufacturing in Malta is alive and well – it is merely differently driven than it was five years ago. The driver is no longer low wages, low value added and high turnovers but the use of new technology to produce higher value added that in turn translates to higher wages for employees.”

Dr Gatt said the results were there for all to see: In the first eight months this year exports increased by Lm30.3 million; sales by the manufacturing sector increased by Lm6.5 million in the first six months of this year when compared to the same period last year; the number of registered unemployed as at September 2007 is the lowest in the last eight years.

He continued: “Who can deny that the loss of jobs in the textiles and traditional manufacturing industries is a blow to our economy and a tragedy to those directly involved? This, however, is a reality and trying to raise false hopes is an injustice to the employees involved. The solution is to move forward.”

Dr Gatt said the government would be announcing new incentives channelling assistance in vital areas such as Research and Development, innovation, training and aid to those entities that decide to invest in their Malta operations. “As members of the European Union we can now use an average of Lm1.5 million per year from EU funds in order to provide cash-based assistance to industry,” he said.

He also said that in the last four years alone, apart from the record in terms of foreign direct investment, the country has seen major companies which had been in Malta for a long time expanding their set-ups. Malta Enterprise approved 137 expansions since 2004, creating no less than 2,600 jobs.